exempt

                                                  (Reprinted with amendments adopted on May 27, 2003)

 

Senate Bill No. 381–Senator Rhoads

 

March 17, 2003

____________

 

Referred to Committee on Finance

 

SUMMARY—Authorizes pilot program to allow state agencies to retain certain cost savings. (BDR 31‑936)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: Yes.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to state finances; authorizing a pilot program to allow a state agency to retain a portion of its unexpended budget that is identified as savings under certain circumstances; authorizing the use of that portion of the savings for training of employees and equipment purchases; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. Chapter 353 of NRS is hereby amended by adding

1-2  thereto the provisions set forth as sections 2 to 10, inclusive, of this

1-3  act.

1-4  Sec. 2.  As used in sections 2 to 10, inclusive, of this act,

1-5  unless the context otherwise requires, the words and terms defined

1-6  in sections 3 and 4 of this act have the meanings ascribed to them

1-7  in those sections.

1-8  Sec. 3.  “Chief” means the Chief of the Budget Division of

1-9  the Department of Administration.

1-10      Sec. 4.  Except as otherwise provided in NRS 353.005, “state

1-11  agency” means a department, division, bureau, institution, office,

1-12  board, commission or other agency of the Executive Department

1-13  of the State Government.

1-14      Sec. 5.  1.  On or before October 1 of each fiscal year, the

1-15  Chief shall identify the amount of each reversion to the State

2-1  General Fund of the unencumbered balance of the sums

2-2  appropriated to a state agency for expenditure in the preceding

2-3  fiscal year.

2-4  2.  On or before December 1 of each fiscal year, the State

2-5  Controller shall, with the consent of the Governor and except as

2-6  otherwise required by specific state statute or other legislative

2-7  measure, by federal law or as a condition to the receipt of money

2-8  from any source:

2-9  (a) Establish a special account in the State General Fund on

2-10  behalf of a state agency for which a portion of the reversion has

2-11  been identified by the Legislative Auditor as savings, unless the

2-12  state agency has ceased to exist; and

2-13      (b) Transfer one-half of the identified savings into the account

2-14  and one-half of the identified savings into the Fund to Stabilize

2-15  the Operation of the State Government.

2-16      Sec. 6.  1.  On or before October 1 of each fiscal year, the

2-17  Chief shall identify the unexpended balance after subtracting the

2-18  sum expended by a state agency during the preceding fiscal year

2-19  from the sum authorized during the most recent legislative session

2-20  for expenditure from sources other than appropriations from the

2-21  State General Fund.

2-22      2.  On or before December 1 of each fiscal year, the

2-23  administrator of a fund in which is maintained any unexpended

2-24  balance identified pursuant to subsection 1 shall, with the consent

2-25  of the Governor and except as otherwise required by specific state

2-26  statute or other legislative measure, by federal law or as a

2-27  condition to the receipt of money from any source:

2-28      (a) Establish a special account in that fund on behalf of a state

2-29  agency for which a portion of the unexpended balance has been

2-30  identified by the Legislative Auditor as savings, unless the state

2-31  agency has ceased to exist; and

2-32      (b) Transfer one-half of the identified savings into the account

2-33  and one-half of the identified savings into the Fund to Stabilize

2-34  the Operation of the State Government.

2-35      Sec. 7.  1.  The Interim Finance Committee shall develop a

2-36  form to be used by state agencies to determine the portion of the

2-37  reversion identified pursuant to section 5 of this act or of the

2-38  unexpended balance identified pursuant to section 6 of this act

2-39  that constitutes savings.

2-40      2.  A state agency may, on or before October 15 of each year,

2-41  submit to the Legislative Auditor an application to identify

2-42  unspent money as savings. The application must be submitted on

2-43  the form developed by the Interim Finance Committee pursuant to

2-44  subsection 1. The application must include:

3-1  (a) The amount appropriated to the state agency for its work

3-2  program for the fiscal year;

3-3  (b) The amount authorized for expenditure by the state agency

3-4  in its work program for the fiscal year; and

3-5  (c) A description of the claimed savings and the manner in

3-6  which they were realized.

3-7  3.  Except as otherwise provided in subsection 4, the

3-8  description of the manner in which savings were realized must

3-9  include:

3-10      (a) The amount of the claimed savings;

3-11      (b) The program used to realize the savings;

3-12      (c) The date on which the program was initiated;

3-13      (d) The time required to carry out the program;

3-14      (e) The manner in which the program improved the efficiency

3-15  of the state agency or the service provided by the state agency, or

3-16  both; and

3-17      (f) Any other information necessary to determine whether the

3-18  savings were realized as a result of increased efficiency and not

3-19  from money that does not qualify for consideration as savings

3-20  pursuant to subsection 4.

3-21      4.  The following sources of money do not qualify for

3-22  consideration as savings:

3-23      (a) Money that was set aside as a reserve pursuant to

3-24  NRS 353.225;

3-25      (b) Money realized from the deferred payment of a capital

3-26  expense or for equipment purchased by the state agency;

3-27      (c) Supplemental appropriations;

3-28      (d) Money realized from shifting costs to another state agency

3-29  or governmental entity;

3-30      (e) Money realized by the state agency from the failure to fill a

3-31  position, unless the position is eliminated;

3-32      (f) Money received from a grant that was not expended; and

3-33      (g) Money realized from reducing the amount or quality of

3-34  services provided by the state agency.

3-35      Sec. 8.  On or before November 15 of each fiscal year, the

3-36  Legislative Auditor shall:

3-37      1.  Review the forms submitted pursuant to section 7 of this

3-38  act to identify any amounts that qualify as savings pursuant to that

3-39  section; and

3-40      2.  Transmit to the Governor for his approval all forms that

3-41  the Legislative Auditor determines to include amounts that qualify

3-42  as savings, indicating the amount that the Legislative Auditor has

3-43  identified as savings.

3-44      Sec. 9.  For the purposes of NRS 353.205 to 353.220,

3-45  inclusive, and 353.230, money transferred to a special account

4-1  pursuant to section 5 or 6 of this act, and money expended from

4-2  such an account, must not be considered as a source of revenue or

4-3  an expenditure of a state agency or be included in the budget of a

4-4  state agency.

4-5  Sec. 10.  1.  A state agency may expend money transferred to

4-6  a special account pursuant to section 5 or 6 of this act for:

4-7  (a) Purchasing equipment, including computers; and

4-8  (b) The expenses of training for employees of the state agency.

4-9  2.  Any interest earned on money in a special account

4-10  established on behalf of a state agency pursuant to section 5 or 6

4-11  of this act must be credited to the special account.

4-12      Sec. 11.  NRS 353.255 is hereby amended to read as follows:

4-13      353.255  1.  [The] Except as otherwise provided in sections 2

4-14  to 10, inclusive, of this act, the sums appropriated for the various

4-15  branches of expenditure in the public service of the State [shall]

4-16  must be applied solely to the objects for which they are respectively

4-17  made, and for no others.

4-18      2.  Any person violating the provisions of subsection 1 shall be

4-19  punished by a fine of not more than $500.

4-20      Sec. 12.  1.  Notwithstanding the provisions of sections 2 to

4-21  10, inclusive, of this act, a state agency may apply to identify

4-22  unspent money as savings pursuant to those sections only if it has

4-23  been approved pursuant to this section to participate in a pilot

4-24  program for the fiscal year for which the savings are sought to be

4-25  identified.

4-26      2.  A state agency that wishes to participate in a pilot program

4-27  pursuant to sections 2 to 10, inclusive, of this act for the Fiscal Year

4-28  2003-2004, 2004-2005 or 2005-2006 shall submit an application to

4-29  the Chief of the Budget Division on or before August 15 of the

4-30  respective fiscal year. The application must identify that budget

4-31  account to which the program would apply, the reasons that the state

4-32  agency believes that it should participate in the pilot program and

4-33  any programs that it believes could save money that would

4-34  constitute savings for the purposes of sections 2 to 10, inclusive, of

4-35  this act.

4-36      3.  The Chief shall review the applications received pursuant to

4-37  subsection 2 and approve not more than 16 budget accounts for

4-38  participation in the pilot program in any fiscal year. To the extent

4-39  practicable, the Chief shall select budget accounts that:

4-40      (a) Have, as indicated in the application, a demonstrated

4-41  potential to generate savings; and

4-42      (b) Represent a variety of state agencies and programs.

4-43      4.  The Chief shall notify the state agencies selected to

4-44  participate in the pilot program each fiscal year on or before

4-45  October 1 of that year. The Chief shall indicate the budget account

5-1  to which the provisions of sections 2 to 10, inclusive, of this act will

5-2  apply. A state agency selected to participate in the pilot program

5-3  shall submit the application required pursuant to section 7 of this act

5-4  and otherwise carry out the provisions of sections 2 to 10, inclusive,

5-5  of this act for that budget account for that fiscal year.

5-6  5.  As used in this section:

5-7  (a) “Chief” means the Chief of the Budget Division of the

5-8  Department of Administration.

5-9  (b) “State agency” has the meaning ascribed to it in section 4 of

5-10  this act.

5-11      Sec. 13.  This act becomes effective on July 1, 2003, and

5-12  expires by limitation on July 1, 2007.

 

5-13  H